Trump confident of India-US trade deal despite fresh tariff measures

New Delhi: United States President Donald Trump has expressed confidence that Washington and New Delhi will soon conclude a trade agreement, highlighting his personal rapport with Prime Minister Narendra Modi even as the US unveiled a new set of tariff measures affecting dozens of economies, including India.

Speaking to reporters at the White House, Trump said the two countries were making progress toward a deal despite longstanding trade differences.

“For years, India took advantage of the United States… They charged us tremendous tariffs and paid nothing… Now it is the exact reverse and we are making a lot of money with India. But we will get to a deal because I like your Prime Minister (Narendra Modi) a lot; he is a good friend of mine, and we get along well. We have a good relationship,” Trump said.

The remarks come amid ongoing negotiations between India and the US over a bilateral trade arrangement that has undergone multiple revisions in recent months.

Meanwhile, the United States announced additional tariff measures targeting more than 50 economies over what it described as inadequate efforts to prevent the import of goods produced through forced labour. The office of the united states trade representative (USTR) identified India among a group of countries that it said had failed to impose and effectively enforce prohibitions on such imports.

According to the USTR, economies with existing forced-labour import restrictions or commitments under trade agreements could face an additional tariff of 10 per cent, while others may be subject to a 12.5 per cent duty. The list includes major economies such as China, Japan, Australia, Israel, Qatar, Russia, Saudi Arabia, Singapore, South Korea, Thailand, Türkiye, the United Arab Emirates and the United Kingdom.

The action has been proposed under Section 301 of the Trade Act of 1974, which authorises the US government to respond to foreign trade practices considered unreasonable or burdensome to American commerce.

The USTR also identified six economies, including the European Union, Pakistan and Canada, for what it termed a failure to effectively enforce existing bans on imports linked to forced labour.

The latest tariff announcement comes against the backdrop of ongoing India-US trade negotiations. Following a phone conversation between Trump and Modi on February 7, both countries had agreed on the framework for the first phase of a bilateral trade agreement (BTA), envisioned as an interim trade pact.

Under the proposed framework, the US was expected to reduce tariffs on Indian goods from 50 per cent to 18 per cent and roll back measures linked to India’s purchases of Russian oil.

However, the trade discussions entered a new phase after the US Supreme Court on February 20 struck down Trump’s broad reciprocal tariff measures that had been imposed under the International Emergency Economic Powers Act (IEEPA) of 1977.

Subsequently, the Trump administration introduced a 10 per cent tariff on imports from all countries for a 150-day period beginning February 24. Since then, India and the US have continued negotiations to revise and finalise the trade agreement in line with the evolving legal and policy landscape in Washington.